Introduction to E-Commerce

Introduction to E-Commerce

The term commerce is stand for trading of goods and products and if ‘E’ for ‘electronic’ is added to this, the definition of E – commerce is defined as commerce or business of items, goods, online services, information or any related things between two entities over the internet.

Following are some definitions of e – commerce: –

• It is the ability to conduct business electronically over the internet.
• It means managing transactions using networking and electronic means.
• It is a platform for selling products & services via internet.

Characteristics of E –Commerce: –

• Establishment of B-to-B relationship.
• Electronic payment.
• E – distribution of products & services.
• Exchange of information.
• Pre and post – sales support.
• Customer relationship management.

Advantage of E–Commerce: –

1. Facilitates the globalization of business
   E–Commerce facilitates the globalization of business by providing some economical access to distant markets and by supporting new opportunities for firms to increase economies by distributing their products internationally.

2. Provides increased purchasing opportunities for the buyer
   As E–Commerce increases sales opportunities for the seller, it also increases purchasing opportunities for buyer.
3. Lowering staffing cost
   As in E–Commerce, the selling & purchasing process is outline, the amount of interaction with staff is minimized.
4. Market based expansion
   An E–Commerce is open to entirely new group of users, which include employees, customers, suppliers & business partners.
5. Increased profits
   With E–Commerce, companies reach more & more customers where physical commerce cannot reach, thus increasing profits.
6. Increased customer service & loyalty
   E–Commerce enables a company to be open for business wherever a customer needs it.
7. Increase speed & accuracy
   E – commerce see the speed and accuracy with which business can exchange information, which reduces cost on both sides of transactions. It is available 24*7*365.
8. Reduction of paper storage
   E–Commerce reduce paper work and paper wastage.
9. Increased response times
   In E–Commerce, the interaction with the system take place in real time & therefore allows customer or bidder to respond more Quickly & thus reduces the time of discussion between then as in traditional commerce.

Limitations of E–Commerce

1. Security
   The security risk in E–Commerce can be-
   • client / server risk
   • data transfer and transaction risk
   • virus risk
2. High start up cost
   

   The various components of cost involved with E–Commerce are:-

   • connection: connection cost to the internet.
   • hardware / software: This includes cost of sophisticated computer, modular, routers, etc.
   • maintenance: This includes cost involve in training of employees and maintenance of web-pages.
3. Legal issues
   These issues arises when the customer data is fall in the hands of strangers.
4. Lack of skilled personnel
   There is difficulty in finding skilled www developers and knowledgeable professionals to manage and a maintain customer on line.
5. Loss of contact with customers
   Sometimes customers feels that they does not have received sufficient personal attention.
6. Uncertainty and lack of information
   Most of the companies has never used any electronic means of communication with its customers as the internet is an unknown mode for them.
7. Some business process may never be available to E–Commerce
   Some items such as foods, high-cost items such as jewellery may be impossible to be available on the internet.

Types of E-Commerce

Main type of E-Commerce is as:

• Business to Consumer (B2C)
• Business to Business (B2B)
• Consumer to Consumer (C2C)
• Consumer to Business (C2B)
• Business to Government (B2G)
• Government to Citizen (G2C)

Frequently Asked Questions (FAQs)

Author
Mr.Rahul Agarwal
Associate Professor,Department of CS & IT
Biyani Group Of Colleges,Jaipur